MANY HOMEOWNERS ARE WARY OF HOUSING RELIEF

Major lenders have begun to promise much more housing relief to troubled borrowers, from forgiving mortgage principal to doling out dollars for closed short sales, in light of this year’s historic mortgage settlement between banks and 49 states.

Bank of America, for instance, has been sending out about 10,000 letters a week to solicit for its mortgage-reduction program for the past five weeks. Problem is, “they’re not responding,” said Bank of America exec Ron Sturzenegger at a real estate writers and editors conference in Denver.

Borrower fatigue is to blame for lower-than-expected interest in in-house programs that provide mortgage help, said Sturzenegger and other panelists at Friday’s event. It stems from dealing with what seem like never-ending loan modifications, unresponsive bank officials and lost documents, all common complaints from borrowers in San Diego County and beyond. Couple that with a constant stream of information on federal, state and lender mortgage programs, and you then have really confused borrowers, panelists said.

“It takes a sophisticated borrower to figure it out, even though the servicer and lender are giving us a clear path,” said Marietta Rodriguez, a director at NeighborWorks America.

Sturzenegger said another factor is borrower avoidance. Homeowners who receive solicitation letters from banks often dodge them or tear them up because they expect bad news.

To deal with that, Bank of America officials have been sending the offer letters by certified mail and then following up with a phone call. Rodriguez advised distressed borrowers to talk to counselors who are approved by the federal Department of Housing and Urban Development. These services are free and should be able to help lost borrowers navigate the complicated paths of mortgage aid, she said.